Page 52 - HopeWest
P. 52
Healthcare practice
While insurers are making adjustments in their rating model as a result of
increased litigation costs, actuaries for self-insured Healthcare Liability
programs are making similar adjustments in retained loss forecasts. This
is an additional direct cost to healthcare organizations in an already
challenged economy. Electronic health records are also having an impact
on future value of claims, as plaintiff’s attorneys focus in on the integrity
and quality of documentation.
At the front line of the battle of COVID-19, the industry has appropriately
adopted an “all hands on deck” approach, recruiting retired workers
and accelerating the entry of new physicians and nurses. In many cases,
they have worked without appropriate personal protection equipment, in
unfamiliar locations and without adequate rest. More importantly, they
have gone home to their families and potentially exposed them to the
illness. While these actions can be viewed as heroic, they also open the
door to new liability issues and have the potential to cause further market
disruption. It is also unclear how state legislatures may deal with liability
issues after the crisis.
ISSUES INCLUDE
• Disruption of revenue due to closure of surgical centers.
• Increased frequency and severity of workers’ compensation losses Some carriers are already reacting by pulling back from the healthcare
including Employer’s Liability claims. sector altogether or signaling further reductions in capacity. This will place
a signiicant burden on healthcare providers by potentially forcing them
• Professional liability issues due to failure to diagnose and treat.
to accept even larger self-insured retentions, reduce limits and/or accept
• Stacking of retentions related to communicable disease exposure. possible restrictive coverage (e.g., communicable disease exclusions).
• Failure to take proper precautions and provide safety equipment.
HopeWest — Lockton: A collaborative Healthcare Practice review 52 Lockton Companies
While insurers are making adjustments in their rating model as a result of
increased litigation costs, actuaries for self-insured Healthcare Liability
programs are making similar adjustments in retained loss forecasts. This
is an additional direct cost to healthcare organizations in an already
challenged economy. Electronic health records are also having an impact
on future value of claims, as plaintiff’s attorneys focus in on the integrity
and quality of documentation.
At the front line of the battle of COVID-19, the industry has appropriately
adopted an “all hands on deck” approach, recruiting retired workers
and accelerating the entry of new physicians and nurses. In many cases,
they have worked without appropriate personal protection equipment, in
unfamiliar locations and without adequate rest. More importantly, they
have gone home to their families and potentially exposed them to the
illness. While these actions can be viewed as heroic, they also open the
door to new liability issues and have the potential to cause further market
disruption. It is also unclear how state legislatures may deal with liability
issues after the crisis.
ISSUES INCLUDE
• Disruption of revenue due to closure of surgical centers.
• Increased frequency and severity of workers’ compensation losses Some carriers are already reacting by pulling back from the healthcare
including Employer’s Liability claims. sector altogether or signaling further reductions in capacity. This will place
a signiicant burden on healthcare providers by potentially forcing them
• Professional liability issues due to failure to diagnose and treat.
to accept even larger self-insured retentions, reduce limits and/or accept
• Stacking of retentions related to communicable disease exposure. possible restrictive coverage (e.g., communicable disease exclusions).
• Failure to take proper precautions and provide safety equipment.
HopeWest — Lockton: A collaborative Healthcare Practice review 52 Lockton Companies
